Funds misspent in rural plan: CAG

The comptroller and auditor general has said that the government’s flagship rural employment scheme is disconnected from the poverty regions of the country, suggesting that proper implementation would have improved the lot of the poor.

A CAG report auditing the performance of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) between April 2007 and March 2012 says that Bihar, Maharashtra and Uttar Pradesh account for 46% of India’s rural poor but the states were able to utilise only 20% of the funds spent nationally.

“This indicates that the correlation between poverty levels and implementation of NREGA was not very high,” the CAG said.

Rural development minister Jairam Ramesh also slammed the report, saying: “The CAG reports, in general, lack constructive suggestions.” But he admitted that the scheme is run poorly in UP, Bihar, Odisha and Jharkhand.

The CAG report tabled in Parliament blames states for not taking the scheme to the poor and the Centre for not monitoring it properly. It adds that the central employment guarantee council – a statutory body headed by the rural development minister – failed to establish an evaluation and monitoring system even after six years.

“Despite the passage of seven years since the act came into force, Haryana, Maharashtra, Punjab, Rajasthan and UP did not formulate rules,” the CAG said, adding that the low awareness levels in several states prevented the beneficiaries from fully claiming their rights under the demand-driven programme.

The CAG report also suspects a large-scale fund embezzlement attributed to absent or incorrect records of works in about 18-54% of gram panchayats checked. The CAG audit was conducted on Ramesh’s request.